It’s the age-old question since the dawn of time when cavemen were selling rock-carved wheels in the Stone Age. The first entrepreneurs, right?
There is a science to pricing, but let’s get to brass tacks on ways to increase sales that any size business can implement. I’d start with a few first, test different strategies, and then add to them as you optimize solutions for your business.
Let’s increase your sales!
- Sell Fewer Things to More Customers
This seems counterintuitive, but it’s about the power of the niche. If you have a full suite of products and services that offer a lot of choices for your customers, believe it or not, you may actually be less valuable than a company that sells one or just a few things to a lot of customers.
Why is that? Because owners can typically employ more generalists who can rely on an R&D, production and delivery, and customer service system that is repeatable and teachable. Building and selling a wide array of products and services gets expensive, and it requires specialists.
It also makes it harder to establish a brand as an expert in a key area that separates you from your competition. That’s why niche companies survive downturns in the market and why they get a lot of repeat business from customers.
Action Item: Analyze your product and service mix and compare that to your business strategy and brand. Determine what makes the best sense to focus on that can rely on a system that is teachable, repeatable, and profitable.
- Sell more of your most profitable products and services
This goes without saying, but I don’t know how many times I talk to my customers, and they have not analyzed what they sell.
Assuming they’ve spent a lot of time understanding pricing and their direct costs for each of the products and services, most business owners are flying blind when it comes to what they sell the most of, what is their most profitable products and services, and what they should sell more of. This is paramount to building a valuable company.
Action Item: Run a Profit and Loss Report by Product and Service you sell that shows your sales, cost of goods sold, and gross margin dollars. Run it as a percentage of revenue so that you do not just look at dollar amounts but the percentage. Determine which products and services are the most profitable and why you have not sold more of them or cross-sold these items more, and then niche focus.
- Create more cross-selling opportunities for your customers
Another way to increase sales is to create more cross-selling opportunities. This is very little from what I’ve seen, and mostly because business owners and their teams have not built sales, delivery, and customer service systems and processes designed to promote cross-selling. When a customer buys from you, when’s the best time to sell more? At the time of the sale.
Action Item: Determine which items you can cross-sell to your customers and analyze your sales process in detail. Are you asking for additional business? Are your salespeople incented to cross-sell (they’ll sell to their plans and what makes them money)? Is there a process that outlines how to do this, how to handle objections, and more? Are there discounts offered, buy one/get one free opportunity, or even additional value that can be communicated to the customer that they have not been told before?
- Hire product salespeople
And not just one – it’s best if you have the budget to hire two salespeople who have sold products. Why is that? First, salespeople are naturally competitive, and someone wants to be the best, so having them compete is a good thing.
Plus, if one doesn’t work out, you’ll at least have another salesperson selling while you find another candidate. Second, product salespeople are used to selling features and functions, and they’re less inclined to offer custom solutions.
They also usually come from sales backgrounds that require them to identify what daily, weekly, monthly, quarterly, and annual tasks are required to hit their numbers.
This is important because, in your business, it’s about selling more widgets, more subscription sales, and more services. And the key is incenting your new salespeople to sell your most profitable products and services by incenting on gross margin, not revenues.
Another note – look at different ways to compensate salespeople. Some ways are 100% commission only, base + commission capped, base + commission ladders, based + a minimum threshold + target threshold + excellent performance, and more.
Action Item: If you have a sales staff, analyze your compensation package and how they’re incented to sell, and determine if adjustments need to be made to drive the right behaviors.
- Expand your sales channels
“If it ain’t broke, don’t fix it.” Or better, “It’s the way we’ve always done it.” This is especially true in Baby Boomer businesses that have been in business for decades. “You can’t teach an old horse new tricks, right?” Okay, enough puns, but you get the idea.
It’s important to understand how you sell to your customers, what’s worked in the past, what works now, and what opportunities are there to reach your customers in new and innovative ways. For example, is it easy for your customers to buy from you, or do they have to go through a cumbersome process to get the sale?
Can your customers find you and buy from you online, through an e-commerce site, or do they have to call a main number, fill out a contact form, or, at the very least, call a Sales number to reach your sales team?
Can your customers find you for more sales through a monthly newsletter, email nurturing campaigns, targeted pay-per-click ad campaigns, sales promotions, follow-up emails and phone calls, and more?
Action Item: Examine the different ways that you sell to your customers, and do research to see if there are new ways to reach and sell to them that will increase sales and make doing business with you easier and better. Look at marketing campaigns, including your website, and see if a refresh is in order. Spend a lot of time with this, interview website and digital marketing firms, talk to your salespeople and improve your sales channels to capture new and existing business.
To Sum Up
Hope these 5 ways to increase sales help you jump-start your sales engine and increase revenues. Feel free to drop me a line to let me know how you’re doing and how this is increasing your company’s value.